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Tuesday, 3 March 1998
Page: 244

Mr COBB (10:36 PM) —I want to alert the House tonight to a gross injustice perpetrated by Ashanti Goldfields, an overseas mining company based in Ghana, West Africa. This company has walked away from operating Cobar Mines, which runs the CSA copper mine in Cobar in my electorate. As a result of that, 260-odd miners are out of work and are left being owed $10.4 million in liabilities—$1.1 million in wages and salaries which has now been paid through the Price Waterhouse administrator but, more importantly, in long service leave and holiday leave $4.2 million of which they will probably see only 50 to 75 per cent at most and $5.2 million of which they will probably see nothing. Some of those workers have been in that mine for up to 33 years and have accumulated six-figure sums.

As well as that there are other creditors. Glencore, the Swiss commodity metals trader, has a secured loan of $16 million which has been defaulted on. But I particularly feel sorry for the unsecured creditors, the small businesses in Cobar and surrounding towns which will not see a cent of the $6 million owing to them. They have had to lay off 53 of their own workers. The fuel supplier to that mine is owed $171,000 and the brickworks that supplied the solid concrete bricks for the stopes are owed $145,000 and have had to lay off 18 of their workers. I know of a widower down in Dubbo who is owed several tens of thousands of dollars and has an unopened box of $45,000 worth of bearings.

This action by Ashanti has been very damaging to the town, to the business and family lives of the people who live in Cobar. When Ashanti bought this mine from Golden Shamrock in October 1996 they bought it at a reduced price because they took over the liabilities of the mine in long service leave and retrenchment payments, et cetera. This is the biggest African gold mining company outside South Africa. A depository nominee owns 33 per cent of the mine; Lonrho, a British company, owns 33 per cent of Ashanti; and the government of Ghana owns just under 20 per cent. I seek leave to have incorporated in Hansard a table of the largest 20 shareholders in the mine and a list of the directors.

Leave granted.

The table read as follows


AS AT 21/02/1997


Per cent

Depository Nominee, Inc.



Lonrho Pic



Government of Ghana



CHESS Depository Nominees Pty Ltd 2,000



Libyan Arab African Investment Co. Limited



Nutraco Nominees Limited



Chase Nominees Limited



Morgan Stanley & Co.Inc.



Chase Manhattan Bank



State Street Bank Limited



Deutsche Morgan Grenfell Inc. 366,177



Roytor & Co.



Ghana Cocoa, Coffee & Peanut Farmers Association



BNY Nominees Limited



Smith Brothers Nominees Limited



Torbay Company



Barclay Zimbabwe Nominees (PVT) Limited



Social Security & National Insurance Trust



Cluff Resources Zimbabwe



Employees Trust Limited Hare & Co.










R.K. Peprah

Chairman, Audit Committee

Mr Peprah was appointed to the Board in 1982, and became Chairman in 1985. Minister of Finance of the Republic of Ghana and Chairman of Mim Timber Company Ltd.

S.E. Jonah

Managing Director, Chief Executive Officer

Chairman of African Selection Mining Corporation. Director of the Ghana Investment Centre, Lonrho Plc, Commonwealth Africa Investment Fund Ltd and a member of the Ghana Minerals Commission and of the Advisory Board of the International Finance Corporation.

J. Grice M.G. Keatley

Secretary Executive Director

Formerly with the International Finance Corporation as Divisional Manager, Treasury and Financial Policy

E.D. Ofori Atta

Executive Director

Ms Ofori Atta was appointed to the Board in March 1994.

H.K.A. Otoo

Executive Director

Mr Otoo was appointed to the Board in December 1986. Executive Director for Government Affairs.


Executive Director

Formerly Senior Vice President and Chief Operating Officer, Pegasus Gold and previously a senior executive of BHP Minerals.

K. Ansah

Non-executive Director, Audit Committee

Mr Ansah was appointed to the Board in May 1989. Chief Executive of the Ghana Minerals Corporation and a director of Aluworks Company Ltd and Volta River Authority.

M.E. Beckett

Non-executive Director, Audit Committee.

Chairman of Greycoat PLC, Horace Clarkson, PLC, Monarch Resources Ltd and Watts Blake PLC. Director, North Ltd, Egypt Trust and North Broken Peko Ltd.

N.J. Morrell

Non-executive Director

Mr Morrell was appointed to the Board 03/03/1997. Mr Morrell is a director and CEO Lonrho Plc.

F. Ohene-Kena

Non-executive Director, Audit Committee

Mr Ohene-Kena was appointed to the Board in September 1995. Ambassador to the Czech Republic. A former member of the Ghana Minerals Commission.

R.W. Rowland

Non-executive Director, Audit Committee

Mr Rowland was appointed to the Board in October 1972. Formerly a director and Chief Executive of Lonrho Plc.

Sir W.S. Ryrie

Non-executive Director, Audit Committee

Sir William was appointed to the Board in September 1995. Vice-Chairman ING Bearing Holdings Ltd and Deputy Chairman of the Commonwealth Development Corporation. Director of W S Atkins Ltd.

P.M. Tarsh

Non-executive Director

Mr Tarsh was appointed to the Board in April 1978. Formerly a Director of Lonhro Plc.

Mr COBB —I thank the House. On 4 December last year, Ashanti Goldfields wrote to the Directors of Cobar Mines and said:

This letter sets out the intentions of Ashanti Goldfields . . . in relation to the provision of financial support to Cobar Mines . . .Ashanti irrevocably and unconditionally agrees to provide financial support to . . . Cobar Mines . . . and Cobar Mines is able to pay all of those debts as and when they become due and payable.

Then it sets out various conditions. Talking about the notice they may give if they ever withdraw the support, it says:

Following this period, if Ashanti were to intend to cease to provide financial support to . . . Cobar Mines . . . it would give not less than 7 days notice of that withholding of financial support before doing so.

This letter is to be interpreted in accordance with the laws of Victoria, Australia—

where they have their main office—

and Ashanti irrevocably and unconditionally agrees to submit to the non-exclusive jurisdiction of the courts of Victoria, Australia.

It is signed by a director, Mark Keatley, who is also the chief financial officer. In the middle of January, Trevor Schultz, who is chief operating officer and a director of Ashanti mines, also wrote a letter saying that the only expenditure which should be incurred on the mine was that which was essential to maintain continuing operations.

We have these solid guarantees from a very profitable company and yet they have walked away and left people in the lurch. While they may be able to do it legally, morally and ethically what they have done is shocking. BHP or Pasminco could not have done that in Australia. They are getting away with this so far only because they are an overseas based company.

I call upon the directors of Ashanti to fulfil the written promise that they have made. I am pleased that this federal government has sooled the Australian Securities Commission onto them. If the commission finds that they have been in breach of the insolvent trading conditions and other conditions of the Corporations Law of this country, such as not having had resident directors of this mine this year, then I think we should take them to whatever courts we have to to recoup these debts. (Time expired)